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ADVANCED MICRO DEVICES INC.
AMD seeks redemption - and sales - with Shanghai
Chipmaker used lessons of Barcelona in revamping design process
By Kirk Ladendorf
AMERICAN-STATESMAN STAFF
Monday, November 10, 2008
To the outside world, Advanced Micro Devices Inc. calls its latest chip Shanghai. To the engineering team, the usual name for the project is Ridgeback. But the real name for this chip could be "Redemption."
AMD wants to restore some of the luster to its image that was lost when its last flagship chip, Barcelona, was months late and plagued by embarrassing bugs.
The chipmaker was counting on Barcelona to revive its sagging fortunes in its perennial battle with Intel Corp., the kingpin of the microprocessor market.
But Barcelona's public problems had the opposite effect. They cost AMD heavily in lost revenue, lost profits, lost morale and lost confidence from its customers.
Now comes Shanghai and the hope for a recovery of reputation and, maybe, sales.
The new chip began shipping to computer makers in October and will become the brain of new servers that show up this month. The formal unveiling is Thursday.
Shanghai is similar to Barcelona, but there have been dozens of enhancements, including the addition of larger on-board memory caches to spur performance.
AMD says the chip will quickly become the standard setter for Windows-compatible server chips, although Intel will counter with its own high-performance chips in the weeks ahead.
"I am delighted with the chip," said Jeff VerHeul , AMD's vice president of silicon design. He cited the reasons: "A, it is early; B, it has greater-than-expected performance; and, most importantly, our customers like it."
He backs the assertion of CEO Dirk Meyer , who called the new chip "the best server product on the market."
The company has yet to deliver precise performance metrics, but VerHeul said Shanghai will deliver roughly 20 percent more performance than Barcelona while running at the same speed. Plus, it will run faster.
The new chip, like Barcelona, contains four processing engines, or cores, but it is far more complex because it is made with a more advanced manufacturing process.
Analysts are not quite as enthusiastic as AMD.
"They need to rebuild their reputation and re-establish credibility," said Nathan Brookwood with Insight 64. "They need to demonstrate that they are executing and delivering on their promises. This should help there."
AMD is aiming for a financial rebound as well after two years of losses. The chipmaker has sold some nonproductive operations and announced plans to spin off its German factory operations into a joint venture it will own with a sovereign investment company based in Abu Dhabi.
In addition, the company announced last week that it had cut 500 jobs worldwide, including 154 in Austin, as part of an effort to cut operating costs as it aims for consistent profitability.
The problems with Barcelona forced AMD's leadership to take an intense look at its design process and fix the flaws it found. Part of that fix involved a new procedure for designing complex, high-performance chips.
In the past, the company relied mainly on one of its two major design centers in Austin or Sunnyvale, Calif. But the work on the new chip would be split among at least five design centers around the world: Austin; Sunnyvale; Fort Collins, Colo.; Dresden, Germany; and Bangalore, India.
The first four centers would all work on key sections of the chip, and the design center in Bangalore, created in 2005, would be responsible for putting the pieces together in a complete design.
The project was directed by a veteran AMD engineering manager Raghuram Tupuri, who moved to India in 2005 to get the Bangalore design center started. He returned to Austin last year.
The approach was the brainchild of VerHeul, who dubbed it Centers of Excellence. He had tried a similar approach at IBM Corp. on engineering projects involving the design of servers.
Splitting up a major chip design among several design centers can result in faster completion of the design, but VerHeul and Tupuri both say the approach requires extensive communications and personal rapport among the key players in the various far-flung design centers.
"We had people from the various sites spend time together so they got to know each other," VerHeul said. "Developing personal relationships is very, very key."
Tupuri said the global design effort came together as one big team, with engineers eventually feeling comfortable enough to call one another on important questions before, during and well after normal work hours.
"We are standing on the shoulders of the Barcelona team and getting the benefit of the lessons we learned from Barcelona," Tupuri said. The engineers "wanted to succeed and put Barcelona behind them. They looked at Ridgeback definitely as a redemption."
The key objective of the team was to check and recheck the design to improve the odds that the first silicon prototypes of the new design would function well. Achieving that goal saved months in the development cycle.
"We were all keen on getting the first silicon healthy," Tupuri said. "If the first silicon is healthy, then the glide-path (to product launch) is set. Even if we delayed the tape-out (formal completion of the design), we wanted to get the first silicon right."
If Shanghai is as good as advertised, then it should help boost AMD's sales of high-performance chips in the months ahead.
But analyst Ashok Kumar with Collins Stewart LLC says the impact of the new chip might be muted by the weakening world economy, which has put a big dent in sales of servers to major corporate buyers.
"Demand has fallen off a cliff," Kumar said. Shanghai "will let AMD hold its own in the current environment, which is the best they can do."